Attachments: Daily GBP/JPY analysis

Daily GBP/JPY analysis

#15,961
Edited 10:08pm Aug 18, 2011 9:54pm | Edited 10:08pm

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Quoting nikim

Disliked

Question. I have my 1 hr GBPJPY which shows the market at the top of the larger downtrend channel. When I zoom in to the 5 min we see that the last blue bar broke out and above the TL.
However it is at the top of the BB and out RSI is in the 70-75 range.

Was that a good short trade to take?
Ride this down to the bottom TL of the smaller uptrend channel.

comments...

Ignored

I think you've got the right idea. However, look for the confirmation of the "Big Picture" on the four hour movement. The 4Hr. really tells the tale of direction. I've always read that the "rule" is; You need one closed candle after the initial breakout candle closes (in or out of the channel). As you can see, we are on the ragged edge, it's too early to be sure. We will know by tomorrow. Be patient and let the trades come to you, instead of chasing them and hoping for the best.

On the attached charts you can see the 1Hr. is well advanced into the downward trend whereas the 4Hr. is just now beginning to show confirmation. I would like to see one full RED candle closed inside the channel as a confirmation of a new downward trend reversal. Remember, you don't have to be the first guy in on the new trend, let others take the beating before you, while you wait to confirm direction.

Most people lose their money because they got in too early and did not wait for confirmation. It's human nature to want to catch every penny you can, but wait, be patient......

I would wish you, "Best of Luck", but this isn't about luck, it's about timing. Maybe I will say, Live Long and Prosper.

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#15,962
Aug 18, 2011 9:59pm Aug 18, 2011 9:59pm

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Quoting amu123

Disliked

Markh, thanks for your valuable insight. Thanks appreciate your time in helping us.

Ignored

Amu123,

It is my pleasure, my passion is trading and I enjoy helping others succeed. Also, please feel free to call me Mark....

#15,963
Aug 18, 2011 10:05pm Aug 18, 2011 10:05pm

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

I would like to see anyone who wishes, post your daily confirmation of trades or your trade history. This will help me to see your trade patterns and your pattern of scaling into positions if you need help in this area.

Be sure to block out your name for privacy if you wish.....

#15,964
Aug 19, 2011 5:11am Aug 19, 2011 5:11am

highintensit
| Joined Aug 2011 | Status: Trader | 3 Posts

Hi Mark,

Do you place any stops? As the trade goes against you and you are adding more lots, is there a point where you will pull the plug? How do you limit your risk?

Thanks!

#15,965
Aug 19, 2011 7:05am Aug 19, 2011 7:05am

Mpt
Joined Nov 2009 | Status: Trader | 2,582 Posts

Quoting highintensit

Disliked

Hi Mark,

Do you place any stops? As the trade goes against you and you are adding more lots, is there a point where you will pull the plug? How do you limit your risk?

Thanks!

Ignored

Google "martingale" . Particularly

http://www.investopedia.com/articles...#axzz1VU215JJF

An old idea that works well, until all your money runs out.

#15,966
Aug 19, 2011 7:22am Aug 19, 2011 7:22am

highintensit
| Joined Aug 2011 | Status: Trader | 3 Posts

Obviously, one tries to avoid ruin, that's why I wonder if there is an uncle point before blow-up that MarkH may have tested or has planned for? A trading strategy should have a fail-safe.

#15,967
Edited 11:32am Aug 19, 2011 8:07am | Edited 11:32am

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Quoting highintensit

Disliked

Hi Mark,

Do you place any stops? As the trade goes against you and you are adding more lots, is there a point where you will pull the plug? How do you limit your risk?

Thanks!

Ignored

Hello Highintensit,

I don't use stops, but that's my personal approach. I would encourage everybody to use stops all of the time. Placing them is up to each one to determine how much you are willing to lose.

And to MPT's point, the Martingale approach. I guess you could say my "leverage in" approach a type of Martingale, but it works for me. I took this very same approach in the stock market crash of 2008 and made a 553% return in eight months. However, it took me a couple of weeks to get multiple positions in each company, usually two to three positions within each company. I do a lot Warren Buffet style investing as well as trading FX. Lot's of homework, understanding a company's future value in relationship to it's market value. Just like Real Estate, there's a current value and a future value. Really good Real Estate investors understand this very well. It's called Value Investing. Another topic for another day, but one of which I have a great passion for. With the stock markets in the condition they are, I think we are again going to be given and opportunity to get some really good companies for really cheap.

Back to FX.... Typically, I may work my way into a trade like this; .5 lot, 1 lot, 2 lots, and done. Usually, no more than three entries. Or you could go, .25 lot, .5 lot and 1 lot. Or... .25 lot, .50 lot and .75 lot. Remember, YOU have control of your comfort levels.

Like I said, it works for me, and I'm happy to share my strategy with others who can benefit as well.

#15,968
Aug 19, 2011 8:13am Aug 19, 2011 8:13am

dpmode
| Joined Mar 2008 | Status: Trader | 28 Posts

Quoting MarkH

Disliked

Hello Highintensit,

I don't use stops, but that's my personal approach. I would encourage everybody to use stops all of the time. Placing them is up to each one to determine how much you are willing to lose.

And to MPT's point, the Martingale approach. I guess you could say my "leverage in" approach a type of Martingale, but it works for me. I took this very same approach in the stock market crash of 2008 and made a 553% return in eight months. With the stock markets in the condition they are, I think we are again going to be given and opportunity...

Ignored

Mark H...if you don't mind can you continue to let us know your entries for trades on this forum until we get used to the system?

#15,969
Aug 19, 2011 8:19am Aug 19, 2011 8:19am

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Quoting dpmode

Disliked

Mark H...if you don't mind can you continue to let us know your entries for trades on this forum until we get used to the system?

Ignored

Sure! As an update, I placed a couple of trades last night and have just now closed them with a small loss, $260.00. I think it's too early to get into any positions right now as there literally is no trending direction but sideways.

#15,970
Aug 19, 2011 8:27am Aug 19, 2011 8:27am

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Sideways chart....

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#15,971
Aug 19, 2011 9:18am Aug 19, 2011 9:18am

highintensit
| Joined Aug 2011 | Status: Trader | 3 Posts

Quoting MarkH

Disliked

Sure! As an update, I placed a couple of trades last night and have just now closed them with a small loss, $260.00. I think it's too early to get into any positions right now as there literally is no trending direction but sideways.

Ignored

Can we dig a bit deeper here? Maybe (likely) some gold here!

What compelled you to take the loss? Is there is no stop, what triggered you to reconsider the trade? Your gut or something more mechanical?

#15,972
Aug 19, 2011 10:07am Aug 19, 2011 10:07am

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Quoting highintensit

Disliked

Can we dig a bit deeper here? Maybe (likely) some gold here!

What compelled you to take the loss? Is there is no stop, what triggered you to reconsider the trade? Your gut or something more mechanical?

Ignored

Sure Highintensit. There is no stop to take out the trades. It was a gut feel that the pair had not executed a distinct direction, more of a ping-pong effect. My gut told me to get out because there is no clear direction.

I might add that I was in profit during the trade (about 40 pips on 7 seven lots), it just did not hit my $7K target. When I awoke this morning, I saw that the trade(s) had been in profit but my "take profit" limit had not been triggered, so I closed it due to the uncertainty of the direction.

#15,973
Aug 19, 2011 3:27pm Aug 19, 2011 3:27pm

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Good week, nice profits. Took a little hit yesterday, first time I've had a loss in while.

Like another poster put it, "you can't be 100% (right all of the time). It's not going to happen." This just proves it...he's right!

Looking forward to next week.... See you all on Sunday/Monday (depending on your location).

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#15,974
Aug 21, 2011 4:22pm Aug 21, 2011 4:22pm

MarkH
| Joined Oct 2009 | Status: "Show Me The Money" - Jerry McGuire | 222 Posts

Still moving sideways, but has now broken out of the 4hr. channel. We're making progress, but it's slow going..... However, notice that lows are making are making higher highs into a ascending flag formation.

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